MicroHoo is Unnerving says Sergey Brin

At a recent event, Google co-founder Sergey Brin called Microsoft's bid for Yahoo "unnerving" and said the move imperils innovation on the Internet. Google also posits that the merger would be illegal. Maybe the merger could violate antitrust laws. Or maybe Brin likes being King of the Mountain, and doesn't want anything to threaten that. Oh, and Brin? Innovation will continue with or without MicroHoo.

The remarks came at an event for the Google Lunar X Prize yesterday. In an interview with the Associated Press, Brin said, "The Internet has evolved from open standards, having a diversity of companies. And when you start to have companies that control the operating system, control the browsers, they really tie up the top Web sites, and can be used to manipulate stuff in various ways. I think that's unnerving."

That's pretty much what Google's chief legal officer David Drummond said in a letter published on Google's Web site shortly after Microsoft's takeover bid was announced. He wrote, in part, "This is about more than simply a financial transaction, one company taking over another. It's about preserving the underlying principles of the Internet: openness and innovation."

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Micro-hoo: will that take a place?

Microsoft believes that he's bluffing and plans to pursue this deal through to a conclusion.
In an interview with my colleague Ina Fried on Wednesday, Bill Gates made clear why Microsoft's in love with this grand vision of a future "Micro-hoo."
"We think that the combination with Yahoo would accelerate things in a very exciting way, because they do have great engineers, they have done a lot of great work. So if you combine their work and our work, the speed at which you can innovate and get things done is just dramatically more rapid," Gates said. "So it's really about the people there that want to join in and create a better search, better portal for a very broad set of customers. That's the vision that's behind saying, 'hey, wouldn't this be a great combination?'"

I'm still not convinced that this won't turn into a disaster, with all the messy corporate-culture clashes that always attend mergers--but on a massive scale. Still, Gates and Steve Ballmer believe that they can successfully steer clear of the potholes, and they're willing to put more than $40 billion behind that bet.

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